• Furniture exports improve

    Published on 11-07-2011 02:01 PM
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    Export sales of Malaysia-made furniture products are likely to be RM7bil to RM7.5bil this year compared with RM7.95bil last year.
    Earlier in June, the Malaysian Furniture Entrepreneurs Association (MFEA) had projected a 15% drop to RM6.8bil.


    Lor Lean Sen

    From January to August, the value of furniture exported by Malaysia was RM4.9bil, down about 7.9% compared with RM5.3bil in the corresponding period last year.
    MFEA president Lor Lean Sen told StarBiz that orders for Malaysia-made furniture had improved in the second half, driven by demand from Japan, India, Russia and Saudi Arabia.
    “Exports to Japan, due to its reconstruction activities, increased to RM554mil during the January-August period compared with RM433mil achieved in the same period a year ago,” he said.
    Lor said Japan was the second largest market for MFEA members, contributing about 8.9% or RM709mil to their RM7.95bil export revenue in 2010.
    He said exports to India improved to RM171mil during the eight months compared with RM137mil previously.
    “Sales to the United States have also improved in the second half over the first half of 2011,” he said.

    Shipments to Saudi Arabia increased to RM101mil in the eight months compared with RM88mil a year earlier, while exports to Russia improved to RM51mil against RM43mil previously.
    “The fact that ringgit has weakened by 3% to 5% in the third quarter also helped to improve the export sales,” Lor said.
    The association has about 3,000 members, of which about 30% are involved in export business.
    On raw materials, Lor said local rubberwood prices had increased by 10%15% to RM1,500 to RM1,800 per tonne, depending on the grade, compared with the last quarter.
    “This has increased the cost of production, which erodes our competitive edge. Rubberwood pricing has gone up because of the rainy season, which stalls the replanting of rubber trees, and due to the higher offer price from overseas customers.
    “Raw material prices are likely to go up further in the future,” he said.
    Lor said the markets in the United States and Japan were likely to improve next year but it would decline in Europe.
    “We are also getting orders from the customers of our competitors in Thailand which have been unable to produce due to the floods in that country,” he said.